NY Fed prospect Kevin Warsh already has wealthy connections

By A. James Memmott

January 9, 2009 at 11:05am

With Timothy F. Geithner set to take over as Treasury secretary, the speculation intensifies over who will replace him as president of the Federal Reserve Bank of New York.

The Wall Street Journal reported Thursday that Kevin M. Warsh, 38, a current Federal Reserve System governor, is one of the leading candidates to succeed Geithner.

Warsh, a Harvard Law graduate, is not an economist by training.

Kevin M. Warsh
Kevin M. Warsh

However, he worked in mergers and acquisitions at Morgan Stanley & Co. for almost seven years. In addition, he was an economic adviser in the George W. Bush White House. And he served on that administration’s National Economic Council.

But at the time of his nomination to the Federal Reserve board in January 2006, Warsh may have been better known for connections to wealth.

He’s married to Jane Lauder, his Stanford classmate and the daughter of Ronald Lauder, the cosmetics billionaire, Republican donor and former ambassador to Austria.

As The Wall Street Journal was quick to blog, the questionnaire that accompanied Warsh’s nomination placed the nominee in exclusive company.

Warsh listed his former memberships in the Union Club of the City of New York and The Brook Club, both private clubs.

And he noted that continued to be a member of the Georgica Association, an East Hampton neighborhood on Long Island where Steven Spielberg also resides.

But opposition to Warsh’s nomination focused, not on his wealth, but his lack of a degree in economics and his connections to the White House.

“Kevin Warsh is not a good idea,” the late Preston Martin, a former Fed vice chairman, told Bloomberg News. “If I were on the Senate Banking Committee, I would vote against him.”

Nonetheless, the committee approved Warsh’s nomination unanimously and he went on to become, at 35, the youngest person to ever serve on the seven-member board that oversees monetary policy, supervises banks and performs other duties.

But, according to press reports, Warsh is no longer viewed as a lightweight, given his role in devising and implementing responses to the current economic problems.

Bloomberg News has described him as part of the government’s “front-line crisis team,” joining Geithner, Treasury Secretary Henry M. Paulson Jr. and Federal Reserve Chairman Ben S. Bernanke.

“(Warsh) has almost an intuitive understanding of financial markets and credit markets,” Allan Hubbard, Warsh’s former boss at the White House Economic Council, told Bloomberg.

Quoting an anonymous source, the Journal reported that “it’s too early to tell” if Warsh will be named to head the New York Fed.

Warsh does have a connection at the at the bank, as Stephen Friedman, the current chairman of the New York Fed’s board of directors, was his boss at the National Economic Council.

The New York Fed is the largest of the 12 Federal Reserve banks in terms of assets, and the New York president always sits on the Federal Open Markets Committee.

Follow Muckety on Twitter Tweet This! Share on Facebook

Click here to sign up for the Muckety Newsletter

 Read related stories: Business · Recent Stories  


  • There are no comments yet, be the first by filling in the form below.

Leave a Comment

The relationship map to the left is interactive.
• Solid lines are current relations. Dotted lines are former relations.
• Expand items with + signs by double-clicking or by selecting multiple items in the map and pressing the "e" key.
• Move an item in the map by clicking and dragging.
• You can also delete items, separate boxes and save maps. Right-click on the map or select Map Tools for these options.
• Find out more about an item in the map by right-clicking on the item and choosing Information about...
• View map color key.
• This interactive map requires Flash player.

Become a fan of Muckety on Facebook

  • Search for stories
    Special Features

Follow Muckety on Twitter Follow Muckety on Twitter
Muckety has no direct connection to most of the people or organizations listed on these pages.
We are unable to forward personal messages or provide personal contact information.
We make every effort at Muckety to ensure that our data is correct and timely. However, relationships are in constant flux and we cannot guarantee accuracy. If you come across incorrect or outdated information, please let us know by email.
© 2017 Muckety LLC